This Practice Note looks at the underwriting of an offer of shares by a public limited company, including how an underwriting is documented, the company's power to pay the underwriter's commission, sub-underwriting and standby underwriting.

Where a public limited company is making an offer of its shares (whether by way of an initial public offer or a secondary offer) (offer) and requires certainty regarding the amount that will be raised it will usually arrange for the offer to be underwritten.

Any selling shareholder involved in the offer will usually make similar arrangements or be included in the arrangements the company makes.

Typically the underwriter or underwriters (where an underwriting syndicate is involved) will undertake to subscribe for all of the company's shares being offered where such shares are not taken up by other investors. It is possible for only some of the offer to be underwritten, eg where a substantial shareholder or a director shareholder has provided an irrevocable commitment to take up their entitlement under a rights issue or an